In 2002, architect William McDonough and chemist Michael Braungart shook up the world of sustainability with their book Cradle to Cradle: Remaking the Way We Make Things. It proposed a radical rethinking, not just of human manufacturing, but of the way humans relate to the earth. Rather than simply reducing the harm we do, humans could become a source of health, a positive force in the world. The iconic example was a tree. A tree is not "efficient," it is abundant, generative, sustaining its own growth while supporting the health of the ecosystem around it.

Humans, McDonough and Braungart suggested, could be like trees. Everything we create could be composed either of biological nutrients, would could be abandoned to biodegrade without harm, or technical nutrients, which could be reused again and again without loss of quality. The authors backed up their ideas with numerous well-known projects and a cradle-to-cradle certification process for products that matched their strict criteria.

Now the two have a new book, The Upcycle: Beyond Sustainability -- Designing for Abundance, which applies the lessons learned in the ensuing decade to larger projects and systems. I called McDonough to chat with him about the ideas in the new book.

Q. What do you mean by "upcycle"?

A. We often talk about recycling, but we're actually not. We are downcycling. Take a plastic water bottle. If we recycle it into a park bench, it's actually downcycling, from a quality perspective. I've reused the molecules, so that's recycling polymer. But I've reduced its qualities, because I mixed it with other things, hybridized it, let's say, with other polymers and various dyes and finishes. The flower pot I made it into is going to a landfill, or potentially an incinerator. It's downcycling, cascading down in quality, from cradle to grave, or cradle to crematorium.

Discussions of how to respond to climate change often involve Very Large Numbers -- the needed investments to transition to a fully renewable energy system are in the hundreds of billions. The brain sort of shuts down when it encounters numbers like that. They are too big to fathom. The one thing that does seem true about them is that nobody's ever going to spend that kind of money on anything. Right? It seems hopeless.

So I always enjoy it when someone comes along to provide some perspective, a comparison that can give us context and help us see the numbers afresh. Today, wind analyst Paul Gipe asks, how much renewable energy could we have gotten from what we spent on the Iraq War?

The total cost of the Iraq War, including future costs to care for veterans, is $2.2 trillion. If we include the interest we have to pay on the debt we used to finance the war, that figure rises to $3.9 trillion by 2053. (See Gipe's article for sources and details.)

So what could that get us? Gipe gets deep into the weeds on renewables cost and yields, but here's the top-line conclusion:

John Upton mentioned this here yesterday, but I wanted to pause for a closer look, as I have been following this story for a while.

Last year, I wrote about the Reid Gardner coal-fired power plant in Nevada; the Paiute Native American tribe being poisoned by the plant; and the tragicomic efforts of the plant's hapless owner, power utility NV Energy, to bamboozle the local media about it.

Then, last month, I wrote about the revelation that NV Energy falsified pollution reports from the Reid Gardner plant for a half-dozen years, crudely copying and pasting the same emissions data year after year. The Nevada Division of Environmental Protection wrote it off as "human error," and, yeah, I suppose "being too stupid to get away with your scam" is an error of sorts.

Meanwhile, Harry Reid wants to close the plant and get Nevada off coal. The coal fleet is aging and new EPA regulations threaten to make upgrades even more expensive. And Nevadans overwhelmingly want cleaner energy.

So NV Energy has finally said: fuck it, coal is more trouble than it's worth. On Wednesday, it rolled out a proposal to completely divest itself of coal assets, replacing the lost load with 60 percent natural gas, 40 percent renewables.

Regular readers are aware that my hopes for sustainability are largely bound up with cities. By the simple act of bringing people together in close proximity, cities encourage diversity, health, innovation, and economic growth. They are the proving grounds where we will test new, more sustainable patterns of work, play, and mobility. I wrote a series of posts about this a while back called "Great Places."

To me, one of the key barriers to truly green and enjoyable urbanism is the continued domination of urban spaces by cars (and parking). Cities, especially cities that grew up in the post-WWII era, are designed for cars; people scurry around on the margins, perpetually nervous about their safety. There's really no way around this as long as car ownership is required to attain a convenient level of mobility, which it still is in the vast majority of cities.

Most public-transit alternatives to personal cars require a substantial investment of time and cognitive energy. Most people, like it or not, just want things to be easy. And so traffic congestion remains the rule in cities, even cities with robust public transit systems.

Tony Hsieh, the celebrated CEO of Zappos.com, wants to change that. (Side note: I never read management books by corporate titans, but for some reason I ended up reading Hsieh's, and damned if it wasn't pretty inspiring. He's an interesting guy.) Hsieh moved Zappos to Las Vegas a while back and ever since he's been investing heavily in making the city a vibrant, livable hub for tech innovation. Now he's dreamed up something truly ambitious and (to me, anyway) exciting.

The idea is to provide an alternative to personal cars that is fast, flexible, multi-modal, and personalized -- something that is easy the way returning shoes to Zappos is easy. It's called Project 100. Ace reporter Katie Fehrenbacher has a great write-up of the plan, but to quickly summarize, Hsieh wants to populate downtown Las Vegas with:

Any action on climate change during Obama's second term will likely come via EPA, not Congress. Crucial new EPA rules are in the works, including regulations on carbon dioxide from new power plants and, climate hawks hope, existing power plants too.

But EPA does not have final say over the regulations it writes.

Before it issues any major rules, the agency has to get sign-off from the Office of Information and Regulatory Affairs (OIRA), which is an office inside the Office of Management and Budget (OMB), which is an office inside the Executive Office of the President of the United States (EOP).

Wait! Don't click away yet! Behind this barrage of acronyms is a serious question about who's really in charge when it comes to environmental rules. Will it be Gina McCarthy, Obama's new pick to run EPA? Or will McCarthy ultimately answer to Sylvia Mathews Burwell, Obama's pick to run OMB? Will the rules be shaped by the public-health standards that have traditionally guided EPA, or by cost-benefit analysis from OIRA?

Georgetown law professor Lisa Heinzerling, who used to work for EPA advising Lisa Jackson on climate policy, recently published a rather scathing critique of OMB that questioned the Obama administration's commitment to transparency on agency rulemaking. She writes ...

... the Obama administration has continued and deepened a longstanding practice of White House control over EPA rules, with cost-benefit analysis as the guiding framework. OMB is the central player in this structure: it reviews, under a cost-benefit rubric, all agency rules that it deems “major” under executive orders mandating this review. EPA rules deemed major by OMB are not issued without OMB’s imprimatur. Thus does the OMB director become the EPA Administrator's boss.

What's worse, throughout Obama's tenure rules have simply disappeared into OMB, never to see the light again, with no explanation for why, or even if, they were rejected. (Heinzerling's article cites several.) The administration has flouted its own guidelines on transparency, which were reaffirmed by the president in an executive order, and has skirted accountability by keeping final rulemaking determinations behind a cloak of secrecy.

I called Heinzerling to get the scoop on the dysfunctional state of the regulatory apparatus.

Banking giant Citigroup recently issued a report [PDF] that ought to thrill fans of renewable energy. However, tucked inside the good news is a pill that some greens will find difficult to swallow.

The good news is that Citi expects renewable energy to triumph; it believes that typical forecasts like those from the International Energy Agency are too pessimistic. Contrary to a certain strain of conventional wisdom, it says, shale gas will not crowd out renewable energy. Quite the opposite.

The pill? Citi expects it will take lots of natural gas -- more than we're currently using, in the medium term -- to get to a power system run primarily on renewables. In fact, renewables and shale gas are in a "symbiotic" relationship, the report says, each helping the other increase market share. If that's true, a moratorium on fracking, called for by many greens, might serve to inhibit the spread of renewable energy.

There are two reasons to see renewables and natural gas as mutually reinforcing. The first and most familiar is that renewables -- at least wind and solar -- are intermittent and require backup plants that can quickly ramp on and off ("peaker" plants) to support them. Those peaker plants typically run on natural gas.

The second reason is less well understood.

I wrote a (rather heady) post this morning about the move from centralized to distributed energy systems. Thanks to John Farrell -- who, by the way, is the guru of distributed energy -- I just came across a great example of how it's beginning to happen.

NRG Energy is a huge provider of power to U.S. utilities, the biggest single provider, actually, with a large fleet of enormous fossil fuel plants. But now it's getting into a different business. NRG has started selling solar panels directly to homeowners. And it intends to couple those solar systems with fuel cells and micro-turbines that can generate power from natural gas, to serve as backup when the sun isn't shining.

What happens then? NRG CEO David Crane puts it this way: "The individual homeowner should be able to tie a machine to their natural gas line and tie that with solar on the roof and suddenly they can say to the transmission-distribution company, 'Disconnect that line.'" Put more simply, consumers will realize "they don't need the power industry at all."

The folks over at Platts have a feature on distributed energy called "the ghost in the machine." That title is ironic, for reasons I'll get into in a minute. Still, it's great to see outfits like Platts taking note of this stuff. For a broad view of the same trend, check out my post on "the next big thing in energy: decentralization."

Platts begins:

The wave of small-scale power generation technologies -- technically known as distributed energy resource (DER) systems -- that are growing in use or undergoing rapid development across Europe, from fuel cells to micro turbines, photovoltaic systems and reciprocating engines, do indeed point to a fundamental change in the way, and by whom, power is generated, transmitted and stored.

It's not just about the power generation, of course, it's also about storage, intelligent management, and demand reduction. It's about creating a lean, resilient, just-in-time electricity system to replace the lumbering dinosaur we live with today.

The centralized paradigm, which still dominates, is simple. It's a one-way street from generators to transmission to distribution to (passive) consumers:

The localized paradigm is more complex, with power going every which way, via multiple technologies:

A new report [PDF] from the International Monetary Fund tries to tally up fossil fuel subsidies around the world and finds that they add up to an eye-popping $1.9 trillion a year. That's 2.5 percent of global GDP!

Brad Plumer has a typically lucid summary on the report's conclusions, but I want to dig in a little on one part, because believe it or not, the IMF's conclusion may be too conservative. The real truth about global fossil fuel subsidies may be more eye-popping yet.

So, where does that $1.9 trillion come from? Around $480 billion of it comes from direct subsidies, i.e., government handing out money. This is what people usually think of when they hear "subsidies." Contrary to popular opinion, the developed world does very little of this kind of thing. Direct fossil fuel subsidies ("pre-tax" subsidies) are overwhelmingly concentrated in the developing world and mostly devoted to making petro-products affordable for poor people:

Those direct subsidies are a) a growing problem for the budgets of those countries, and b) a fraught and delicate political issue. Needless to say, people don't like suddenly losing a big pot of financial assistance. They often retaliate by rioting or, you know, starving. The report contains a big section on ways that countries can wind back those subsidies without unduly hurting the poor. It's interesting.

But my focus here is on the other $1.4 trillion, which is IMF's tally of "the effects of energy consumption on global warming; on public health through the adverse effects on local pollution; on traffic congestion and accidents; and on road damage." These are the "externalities" you're always hearing about, and by failing to make fossil fuel companies pay for them, governments are implicitly subsidizing those companies. IMF calls this under-taxing of fossil fuels "mispricing," but it's easier to think of them as indirect subsidies.

Indirect subsidies are much larger than direct subsidies -- a point I have made before -- and are concentrated in developed countries:

London-based HSBC is a banking and financial services company, very old and very large -- the sixth largest public company in the world. Greenpeace it ain't. So it's striking that the latest report from the financial giant sounds strikingly like the hippie alarmism of a Bill McKibben, a Joe Romm, or a ... me. Then again, our hippie alarmism sounds a lot like the science surveys put out by the International Energy Agency, the World Bank, MIT, and the U.S. National Climate Assessment.

So I guess we're all hippies now.

The report is called "Peak Planet" (you gotta pay for it, unfortunately -- Giles Parkinson has a great write-up) and it's about the threat of climate change and "the next upswing in the climate agenda."

The broad story HSBC sketches is familiar. If we want to hold warming below 2 degrees Celsius over pre-industrial levels, there's only so much carbon we can dump in the atmosphere. That's our "carbon budget." We can either budget for an 80 percent chance or a 50 percent chance of avoiding 2C (obviously the budget is bigger if the chances of success are reduced). Like so:

The difference between the bars on the left and the bars on the right shows that, between 2000 and 2012, we used up about 420 gigatons of our budget. At the rate we're going, says HSBC, we'll burn through the 80 percent budget by 2026 and the 50 percent budget by 2039. To avoid that unpleasant outcome, global carbon emissions need to peak soon -- by 2020 at the latest, says HSBC -- and begin declining rapidly.

Achieving that wildly ambitious aim would mean, as McKibben so well elucidated, leaving somewhere between 60 and 80 percent of current fossil fuel reserves in the ground. That's about $27 trillion worth of value that must be set aside.